174 | DBS Annual Report 2016
43 Capital Management
The Board is responsible for setting the Group’s capital management objective, which is to maintain a strong capital position consistent with
regulatory requirements under MAS Notice 637 and the expectations of various stakeholders, e.g. customers, investors and rating agencies.
The Board articulates this objective in the form of capital targets. This objective is pursued while delivering returns to shareholders and
ensuring that adequate capital resources are available for business growth and investment opportunities as well as adverse situations,
taking into consideration our strategic plans and risk appetite.
The Group’s capital management objective is implemented via a capital management and planning process that is overseen by the Capital
Committee. The Chief Financial Officer chairs the Capital Committee. The Capital Committee receives regular updates on the Group’s current
and projected capital position. A key tool for capital planning is the annual Internal Capital Adequacy Assessment Process ICAAP through
which the Group assesses its forecast capital supply and demand relative to regulatory requirements and internal capital targets. The
ICAAP has a three-year horizon and covers various scenarios, including stress scenarios of differing scope and severity.
The Group is subject to and has compiled with the capital adequacy requirements set out in the MAS Notice 637, which effects the Basel
Committee on Banking Supervision’s capital adequacy framework in Singapore throughout the year. The Group’s capital adequacy ratios
as at 31 December 2016 have been subject to an external limited assurance review, pursuant to the MAS Notice 609 “Auditor’s Report
and Additional Information to be submitted with Annual Accounts”.
44 Segment Reporting
44.1 Business segment reporting
The Group’s various business segments are described below:
Consumer BankingWealth Management
Consumer BankingWealth Management provides individual customers with a diverse range of banking and related financial services. The products
and services available to customers include current and savings accounts, fixed deposits, loans and home finance, cards, payments, investment
and insurance products.
Institutional Banking
Institutional Banking provides financial services and products to institutional clients including bank and non-bank financial institutions, government-
linked companies, large corporates and small and medium-sized businesses. The business focuses on broadening and deepening
customer relationships. Products and services comprise the full range of credit facilities from short-term working capital financing to
specialised lending. It also provides global transactional services such as cash management, trade finance and securities and fiduciary services;
treasury and markets products; corporate finance and advisory banking as well as capital markets solutions.
Treasury
Treasury provides treasury services to corporations, institutional and private investors, financial institutions and other market participants. It is
primarily involved in sales, structuring, market-making and trading across a broad range of financial products including foreign exchange, interest
rate, debt, credit, equity and other structured derivatives. Income from these financial products and services offered to the customers
of Consumer BankingWealth Management and Institutional Banking, is reflected in the respective segments. Treasury is also responsible for
managing surplus funds.
Others
Others encompass a range of activities from corporate decisions and include income and expenses not attributed to other business segments,
including capital and balance sheet management, funding and liquidity. DBS Vickers Securities and Islamic Bank of Asia are also included in
this segment.
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Financial statements
The following table analyses the results, total assets and total liabilities of the Group by business segment:
The Group Consumer
Banking Institutional In millions
Wealth Management Banking
Treasury Others
Total
2016 Net interest income
2,715 3,487 578 525 7,305
Non-interest income 1,564 1,729 551 340 4,184
Total income 4,279 5,216 1,129 865
11,489
Expenses 2,384 1,737 564 287 4,972
Allowances for credit and other losses 129 1,499
– 194 1,434
Profit before tax 1,766 1,980 565 772 5,083
Income tax
expense 723
Net profit attributable to shareholders 4,238
Total assets before goodwill and intangibles 96,405 231,929 102,701 45,418 476,453
Goodwill and
intangibles 5,117
Total assets 481,570
Total liabilities 187,387 167,598 47,836 31,779 434,600
Capital expenditure 87 19 17
198 321
Depreciation
a
39 20 4 212
275 2015
Net interest income 2,157
3,538 694
711 7,100
Non-interest income 1,390
1,752 446
249 3,837
Total income 3,547
5,290 1,140
960 10,937
Expenses 2,261 1,722
572 345
4,900 Allowances for credit and other losses
116 558
38 107
743 Profit before tax
1,170 3,010
606 508
5,294 Income
tax expense
727 Net profit attributable to shareholders
4,454 Total assets before goodwill and intangibles
90,685 224,196
91,257 46,579
452,717 Goodwill
and intangibles
5,117 Total assets
457,834 Total liabilities
172,723 155,231
43,354 43,730
415,038 Capital expenditure
75 28
12 219
334 Depreciation
a
37 11
4 199
251
a Amounts for each business segment are shown before allocation of centralised costs
176 | DBS Annual Report 2016
44.2 Geographical segment reporting
